Meet Four Types Of People Addicted To Saving Money

Saving money is one of the hardest things to do on a consistent basis.

An estimated 28 percent of Americans don’t have any money set aside for emergencies at all, and just under half of the American population claim to have less than three months’ worth of household expenses saved.

Yet a study conducted by Professor George Loewenstein of Carnegie Mellon found that despite the challenges people have with saving money, a significant 25 percent of study participants actually found it painful to spend money, even on basic and necessary needs.

Are Americans Actually Addicted to Saving Money?

While it seems more like a Utopian concept, the argument that some consumers may be addicted to saving money may not be as inconceivable as it sounds.

The results uncovered that if participants liked the chocolate, the brain’s reward center (the nucleus accumbens) demonstrated a positive reaction to seeing the candy — this is the same area of the brain that is linked to other enjoyable acts like hearing music. Upon seeing the chocolate’s price tag, however, the pain and disgust regions of the brain (the insula) showed activity — a region that responds to such occurrences like smelling foul odors.

These findings suggest that the brain’s negative response to tapping into a bank account is its inherit way of reeling in consumers from seeking out too many pleasure-seeking experiences (i.e. chocolate, shopping sprees, etc.).

This adverse response to the thought of losing money is what may have paved the way for the different types of savers who seek to pad their savings account with extra cash.

Money Hoarders — Four Savings Addict Personalities

There is no way to pigeonhole savers into a single, collective bunch. Money hoarders come with a variety of characteristics and have different motivations for saving money. Here are four ultimate savers who are committed to saving money that Go Banking Rates identified:

The Tightwad

Financial Philosophy: “It hurts to spend money.”

Think of the tight-fisted personality of Ebenezer Scrooge and that’s what you’ll find when faced with a tightwad. This group of cheapskates are the sort that Loewenstein’s study identified as being pained or “disgusted” at the thought of spending money.

It’s likely that the very thought of being social sends shivers down their spines for fear of what expenses may lurk behind a seemingly innocent night out with friends. These individuals are so addicted to saving money, even spending on basic necessities becomes an issue.

What to Do: When dealing with the financial habits of a tightwad, Lowenstein recommends experimenting with different bank accounts to help keep budgets and savings priorities reasonable. For example, keep one account strictly for an emergency fund, while the other is used as a discretionary account for items like personal hygiene products, groceries, etc.

The Frugalist

Financial Philosophy: “Saving money brings me joy.”

Savers who consider themselves to be frugal, rather than tightwads, relish in the act of saving money — namely, that their joy is not tied to material goods and they experience a freeing and enriched lifestyle without relying on consumerist behaviors. (Photo: iVillage)

“While much attention is focused on consumption, saving can also deliver joy and satisfaction: The feeling that financial security is not a destination, but a lifetime journey with a positive trajectory,” shares Karen Carlson, Director of Education at InCharge Debt Solutions. ”Happy savers are typically independent and unconcerned with social pressures to drive a flashier car or have the latest gadgets.”

In a Go Banking Rates exclusive with Jeff Yeager, the self-proclaimed Ultimate Cheapskate, he noted how “consumer-driven” the holiday season has become and what families can do to have meaningful memories instead.

Yeager says, “Now is the time to have the conversation with family and friends [you've] given gifts to in the past and ask, ‘How do we want to handle that this year?’”

What to Do: Gifting recommendations Yeager offers is to agree to re-gift thoughtfully, or purchase only dollar-store gifts.

“The best gifts I’ve ever been given were old photos that I’ve never seen before — go to the dollar store, buy a $1 frame and place the picture inside,” suggests Yeager. “I like to ask adults how many gifts can they remember that they’ve since received — the answer is none, very few. But if you ask what memories do you recall — well, stuff and objects tend to depreciate, and experiences and memories tend to appreciate.”

The Food Hoarders

Financial Philosophy: “The more I buy, the more I save.”

With rising food prices, it’s no wonder some turn to big box retailers with the erroneous assumption that just because the products are packaged in bulk, they’re automatically a better deal.

Thomas Nitzsche of Clear Point Credit Counseling Solutions shares how shoppers exhibit “base value neglect,” a process wherein food hoarders fail to correctly estimate their savings based on the cost per item or unit.

Over-consumption. Sure, a family may like the taste of Honey Nut Cheerios, but being forced to eat the same cereal day in and day out just to avoid wasting the money spent on a bulk-sized family pack of cereal is simply excessive.

Storage space. Once the groceries and canned food exceed the available cabinetry in the home, and begin encroaching upon the living space, there’s a problem.

What to Do: Always read the price tag label as you go through the warehouse aisles. They typically have the cost per unit price clearly shown on the tags, says Nitzsche. This can help make the decision between buying bulk or at you local grocer much easier.

Also, being realistic about purchases can make saving money almost instinctive. If you know you’re not going to have that cheese-stuffed ravioli you sampled anytime this week for dinner, pass on it — chances are, you won’t miss it.

The Extreme Couponers

Financial Philosophy: “I enjoy getting more for less.”

Another type of saver addicted to saving money are extreme couponers. Couponing has been a widely publicized phenomena, especially with the help of TLC’s Extreme Couponing show, but as viewers get a longer peek behind the coupon stacking lifestyle, there become evident precautions that need to be taken to ensure that money is still, in fact, being saved. (Photo: Respaced)

Extreme couponers experience similar dilemmas as food hoarders in that some justify a purchase just because the item is on sale or at a discount rate after stacking a few coupons. Shoppers who are addicted to saving money by stacking coupons may save on household items such as laundry detergent, but the real trouble arises when their hauls overflow with processed food filled with empty calories and high-sugar sports drinks.

What to Do: Saving money is an admirable accomplishment, but always ensure that you’re keeping your family’s health in mind. Are these six boxes of Ritz crackers really necessary? How about the 12 2-liter bottles of Coke? You may be saving money now, but the hundreds of dollars being saved by extreme couponers won’t compare to the thousands spent on long-term medical bills down the line.

Carlson explains that like an addition, “the more you save, the more you want to. Security feels good.”

And there’s nothing wrong with being addicted to saving money. For those accomplishing their financial goals with these extreme savings methods, a savings addiction can feel extremely rewarding. The key for money hoarders, however, is to always proceed with awareness and be willing to reign in savings habits if they go overboard.